File this one under nice try: The U.S. Supreme Court today ruled against a man who argued stealing $300,000 of an acquaintance's bank deposits didn't fit the definition of bank fraud. His reasoning? The bank itself didn't lose a dime.

The Supreme Court not surprisingly rejected that argument in Shaw v. U.S., ruling unanimously that the federal bank-fraud statute, which outlaws any "scheme to defraud a financial institution," also outlaws schemes to defraud a customer by stealing the money he has on deposit at the bank. Since banks use deposits to fund loans, the money that technically belongs to depositors also belongs to the bank.

In this case Laurence Shaw was convicted of using account information to surreptitiously steal hundreds of thousands of dollars from the Bank of America account of Stanley Hsu, a Taiwanese businessman who employed the mother of Shaw's girlfriend and perhaps unwisely had his U.S. bank statements sent to Shaw's house. Shaw moved the money to a PayPal account in Hsu's name and then on to bank accounts he set up in other people's names. (Hsu, for whatever reason, didn't examine his statements on a regular basis.)

Shaw appealed his conviction to the Supreme Court, which took the case to resolve a split among the federal circuits over whether prosecutors must prove an intent to defraud the bank itself, or just a scheme to perpetrate a banking fraud generally. If the former, then Shaw would be off the hook since Bank of America itself didn't lose any money in the scheme. (PayPal, which had fraud-protection program, did lose more than $100,000.)

Sadly for Shaw, the answer was the latter. Justice Steven Breyer, writing for the court, said in most cases bank deposits are also the property of the bank, since it uses deposit money to lend out to others. And even if that weren't the case, the fact that the bank didn't lose any money in the fraud doesn't mean it wasn't still fraud. He cited Judge Learned Hand, who once ruled that even if somebody gets a quid quo pro of equal value for that which is taken away through fraud, the misrepresentation itself still constitutes fraud. Likewise it's no defense to a theft charge to say the loss was covered by insurance.

Shaw also argued he didn't know that he was stealing bank property when he siphoned money out of Hsu's account. He learned another old lesson: Ignorance of the law is no defense.

I am a senior editor at Forbes, covering legal affairs, corporate finance, macroeconomics and the occasional sailing story. I was the Southwest Bureau manager for Forbes in Houston from 1999 to 2003, when I returned home to Connecticut for a Knight fellowship at Yale Law Sch...